With Justice Kavanaugh’s confirmation and the Senate staying in Republican hands, complaints abound about the “undemocratic” Senate. The thing is, there is a much more undemocratic branch of the government. And, no, I’m not talking about the Supreme Court. No elected official hires, confirms, or fires officials in this branch. Ever. Yet these government officials wield huge power over the everyday lives of Americans. These are executive branch officials who are not presidential appointees.

The number is huge. According to the US Office of Personnel Management, as of 2014, employment in the national government’s civilian agencies (that is, excluding defense) topped 1.3 million employees. The president appoints around 4,000 of this number. If we include state and local government employees (and exclude all teachers, in both K-12 and in state colleges and universities), local, state and national government employment exceeds 5 million as of 2014. Almost all of this employment subsists in the governments’ executive branches.

To be sure, it’s difficult to imagine cashiering the merit system in the national and state governments’ executive branches and moving back to something closer to a patronage system (although proposals exist). But that’s the point: If “democratic” governance is an absolute standard of political good and bad, then the part of government that most offends against that standard today is neither the Senate nor the courts—it is the vast part of the executive branch that is neither elected nor answers to elected officials. To complain about the elected U.S. Senate being “undemocratic” while ignoring the nation’s (and states’) unelected executive bureaucracies strains at the gnat while swallowing the camel.

Immunizing the vast part of the executive branch from accountability to elected officials was the manifest purpose of civil service reform and the move to the merit system in the late 19th century and the first half of the 20th century. This anti-democratic move was a hallmark of the Progressive movement over a century ago. Its anti-democratic implication is ironic given Progressive initiatives to make the Senate more democratic (through popular elections) and Progressive criticism of “undemocratic” judges.

Today, however, the U.S. Senate is drenched in democracy compared to the executive branch, 99.9 percent of which is now immunized from any electoral accountability. It’s hard to take seriously liberal and left criticism of an “undemocratic Senate” in the face of stony silence regarding a vastly less democratic executive bureaucracy.

Electoral accountability of the executive branch, the whole executive branch, is the reason the Constitution vests executive power in an elected president in the first place. Article II begins with the vestment clause, the straight-forward instruction that “The executive Power shall be vested in a President of the United States of America.”

In a 1789 speech in Congress on the president’s removal power, James Madison starts his discussion of constitutional principles stressing the significance that the president (“the first magistrate”) is elected by the people. The Constitution’s vestment clause, he suggests, is the mode by which the Constitution links the executive branch to the nation’s voters.

The elected president is the institutional linchpin by which unelected executive branch officials are held accountable to voters. That mechanism works, however, only if the president can hire and fire executive branch officials.

The Constitution, Madison observes, establishes that the president “should be responsible for the executive department.” He notes the critical connection between the president’s authority over executive branch officials and the president’s accountability before voters. “So far therefore as we do not make the officers who are to aid him in the duties of that department responsible to him, he is not responsible to his country.”

To be sure, Madison is speaking specifically about cabinet officials (the bill being debated would require Senate approval for the president to dismiss cabinet officials). The principles Madison identifies, however, extend to executive officials throughout the branch. Aside from textually stated exceptions to the president’s executive power (Madison mentions the Senate confirmation power), Madison reads the Constitution to mean “the legislature has no right to diminish or modify [the president’s] executive authority.

The power to hire and fire executive branch officials, except where the Constitution provides otherwise, is for Madison an essential feature of executive power: “I conceive that if any power whatsoever is in its nature executive it is the power of appointing, overseeing, and controlling those who execute the laws.”

To be sure, Madison remarks the executive trust is a “high one,” even “a dangerous one.” After a century of expanding executive power, Americans can easily harbor reservations about expanding this power any further. Especially if we were to re-recognize that vesting executive power in the president also necessarily means growing his control of the executive bureaucracy, those reservations might grow.

Madison responds, however, “I am not sure but it will be safer here than placed where some gentlemen suppose it ought to be.” Perhaps part and parcel with re-recognizing the president’s full constitutional power over the executive branch would be a broader understanding of the impeachment power. Madison acknowledges, “I own that I am not afraid to place my confidence in [the president], especially when I know he is impeachable for any crime or misdemeanor, before the Senate, at all time, and that at all events he is impeachable before the community at large every four years.”

We can and should worry about the size, scope and exercise of the president’s executive power. But we cannot do so by throwing away fundamental constitutional texts or principles. Recognizing the president’s executive authority extends over the entire executive branch is not merely a legal formalism. It is the very means by which the Constitution extends democratic control and accountability over the executive branch, over the whole executive branch.

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As a holdover from the Reagan administration, I confess to having found working for George H.W. Bush frustrating. With Reagan, there was a clear and simple direction to the bureaucracy—smaller government and deregulation. Fighting the Evil Empire was the watchword of foreign policy. In contrast, and particularly in domestic policy, President Bush sounded an uncertain trumpet, and some of the notes seemed to call for reversing direction. A “kinder and gentler America” suggested that the America Reagan was creating was unkind and maybe a little cruel, when in reality his focus on restoring economic growth and civic confidence was a tonic that should never be left to run dry.

And even the spirit of my office changed—not, I thought, for the better. In the Reagan Justice Department, the Office of Legal Counsel had been driven by jurisprudential principles like originalism and federalism. These principles were in a sense our clients. But under Bush, we focused on advancing messy policy interests and the jurisprudence became secondary. And in the department as whole, there was confusion on fundamental issues like civil rights, with people in favor of color-blindness battling with those who wanted race-conscious policies without direction from the top. To my mind, President Reagan had been a bold leader steering a steady course ahead toward classical liberal destinations. On domestic policy, George H.W. Bush seemed more like a senior bureaucrat, just trying to move an issue from his inbox to his outbox with the minimum of controversy and little concern for coherence. In part for these reasons, I resigned before the end of the term and headed to academia.

I have a much more favorable view of his presidency three decades later. That is the result, partly, of grading on a curve. He was a better President than anyone who came after. Unlike his son, he did not lead the nation into a disastrous war and grow the federal deficit. He did not aggrandize the state like Barack Obama. He not bring shame to the office like Bill Clinton or divide the nation with unpresidential conduct like President Trump. He was no Reagan, but at that time I did not realize that I can probably expect over my lifetime only one great President.

Second, I have better appreciation for the constraints of politics. Reagan could pursue a relatively radical program of liberty, because he was elected against the background of extreme government failure—particularly in the form of the Carter administration. But Reagan’s very success made further reforms seem less necessary and the barnacles of interest groups naturally reattached to government. Moreover, Bush faced a Democratic House and Senate that had been emboldened by gaining seats in the 1988 election.

Third, he did some things, particularly in foreign policy, affirmatively well—handling the end of the Cold War and removing Saddam Hussein from Kuwait. That does not mean I approve of all his actions. The budget deal was the single largest error, one that probably doomed his presidency, creating a fiscal contraction that led to a recession.

But I was a very young man in the Reagan administration, far more confident in the permeability of the world to the right ideas. As a much older man, I recognize that the substantial limits on political improvement. I am therefore far more grateful to George H.W. Bush, who did not inflict much harm and did some occasional good. That may not seem like much of an epitaph, but it is better than how honest epitaphs for most of our Presidents would read, let alone how most politicians in the world’s history will be remembered.

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Ross Douthat has called attention to a growing number of conservatives, particularly religious conservatives, who are calling for more state power to advance conservative ends. They see the state not as a potential oppressor but a “harmonizer,” of values. One even calls for conservatives to seek to become the “Party of the State,” and thus give up trying to restrain the administrative state but turn it into a battering ram against liberalism.

In a future post, I will discuss what I believe are errors in political philosophy of this new movement. Here my point is simpler and blunter. In our era, it is a sociological fantasy to believe that aggrandizing the state will lead to a revival of the values conservatives hold dear. The classes with entrenched control of the administrative process of the state lean strongly to the left and will do so for the foreseeable future. Empowering the administrative state is empowering left-liberalism.

Begin with the general administrative state. The data are clear: federal bureaucrats are to the left of the Democratic Party. They are already the party of state and cannot be dislodged. And that is not a surprise. Particularly at the highest levels, the bureaucrats are graduates of our elite universities, the most left-wing institutions in our society. The issues presented to the administrative state are framed by the press—also an overwhelmingly left-leaning group. Some of Trump’s complaints about the deep state are overblown, but he is certainly correct that it’s far more difficult for conservatives to turn the ship of state to the right. When I was in government, bureaucrats often undermined our programs.

Nothing is more important to preserving conservative values than K-12 education and nothing shows better the futility of relying on state control to secure those values. As Michael McConnell once observed, the public school ideology seems to be a “a vaguely leftish stew of environmentalism [and] moral relativism.” I would add diversity ideology to today’s mix. Some elements of this stew are hard to distinguish in their structure and truth claims from the theological tenets of religions like pantheism that are particularly in tension with the Judaeo-Christian traditions central to American conservatism. But the notion that conservatives are going to be able to turn public schools for their ends is risible. Teachers stand to the left of the public and the National Education Association is one of the mainstays of the left wing of the Democratic Party.

In contrast, gains for conservatives in K-12 education have come here from breaking up state power and giving more autonomy to individuals to choose schools. The means of choice are various—school vouchers, tax credits for private schools, and charter schools—and my point is not to choose among them here. Any fragmentation of state control allows for greater influence of citizens on the education of their children. Vouchers and tax credits are particularly good for religious conservatives who would otherwise have to pay twice for the education of their children—once for the public schools antithetical to their values and again for their faith-based schools. If school choice is a neoliberal project (a word some of these writers, like the left, use with contempt), traditional conservatives should welcome more such neoliberalism.

Conservatives, particularly religious ones, benefit from the shrinking of state control in education and administration, because it allows them to live their out their own values and to persuade others by example that their values are right. That strategy is not certain to win the culture war but acquiescing to the big administrative state will surely lose it.

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The French Minister for Ecological and Solidary Transition, François de Rugy, was recently forced to resign over public outcry at allegations of unnecessary extravagance at public expense—allegations that were given very wide publicity but which the former minister has since denied. He says that he was the object of a “media lynching.” 

Personally, I am inclined to doubt the honesty of anyone who agreed to head a ministry with such a vague, obscure, and bizarre name. Transition to what, exactly? “Ecological” conjures environmental concerns. As for the word solidary, modern English speakers can confirm that it is not in common use. According to the Shorter Oxford English Dictionary (which informs us that solidary is the exact translation of the French word solidaire), it means “characterized by or having solidarity or community of interests” or in legal parlance “jointly and severally.”

I have some difficulty in construing the phrase “solidary transition.” It has an Orwellian ring, as if implying the practice of some kind of secret psychological engineering, employing tools such as blackmail, torture, and public shaming. Thanks to the operation of the Ministry, people who were formerly individualistic or hostile to one another might become laudably altruistic, and France henceforth a nation of Good Samaritans. 

Courtesy of the British National Health Service, I have quite a lot of experience with the bureaucratic use of phrases that have vague connotation but denote nothing specific. Almost always, they are used as a pretext for the employment and promotion of people whose prolonged and unnecessary education has disqualified them from useful work, and instead prepared them for militant time-wasting and obstruction of others, and for the diversion of useful activity into channels of frustrating meaninglessness so that a deadly combination of frantic busyness and terminal boredom supervenes. This works to the advantage of the powerful: those who are obliged to work hard at nothing are compliant and docile, for they fear to lose their jobs—who else would hire them?

A minister of ecological and solidary transition, then, is prima facie likely to be a person of doubtful integrity, moral and intellectual if not financial. And as far as I can make out, M. de Rugy, irrespective of what he has been accused of doing, has spent his entire adult life (he is now aged 45) swimming in the murky waters of the French political bureaucracy, as a member of that hated and despised class that recently was the object of the Gilets jaunes protests.

The misdemeanor crimes of which de Rugy was accused were—in the history of political wrongdoing—rather minor. He held several dinners of some luxury in his ministry, with allegedly rare wines (none of which, he claims, cost more than $35 a bottle), and involving a great number of lobsters. He also had his ministerial apartment in Paris redecorated at a cost of about $75,000, including the construction of a dressing room (or, on his account, cupboards) at a cost of about $20,000. He also bought—or rather, caused to be purchased—a hair-drier for about $600, first reported as gold-plated (but this was fake news). At no time was it suggested that he had enriched himself personally; moreover, he said that champagne gives him a headache and that he is allergic to shellfish. 

Attending the dinners, however, were said to be some of his friends rather than people who might have business with the ministry—lobbying and that kind of thing. If he did entertain these friends, which he denies, his behaviour sounds more like adolescent showing off than anything else. Unfortunately for de Rugy, though, he made a number of enemies when he was a member and speaker of the National Assembly due to his repeated calls for transparency in the incomes and expenditures of political figures. Revenge is a dish best eaten cold—especially when it is of lobster.

The commentary that followed the exposure of this less than world-shattering scandal fell into two main categories: the Caesar’s-wife-should-be-above-suspicion school and the victim-of-media-lynching-and-hypocritical-English-morality school. France is not Sweden, said an editorial in Le Figaro, the conservative newspaper, although it added that ministers should behave with restraint and good taste. 

In the same newspaper, the philosopher Luc Ferry used the occasion to discourse on the French national vice of envy, which he said the whole affair had brought once more to light. In my observation, money is to the French what sex is to the English—namely, the subject of a great deal of hypocrisy. The French (grosso modo) are simultaneously egalitarian and avaricious, a contradictory combination which can result in only one of the Seven Deadly Sins, envy. 

By implication, then, the significance of the de Rugy affair (according to Ferry) lies in the fact that the ex-minister became the object of envy; that in essence, many people in France would like to eat lobster and drink fine wines in the dining room of a ministry, and therefore hate those who currently enjoy this ethically-questionable job perk. Ferry quoted some very pointed words of no less a patriot than General de Gaulle on the subject of his countrymen’s envy:

Envy is our national vice, it is the worst of the Deadly Sins, it is what projected the angels into Hell because they wanted to be the equal of God. It is worse than pride because pride has a certain nobility, while envy is the feeling of the defeated and rancorous, it is the crime of Cain against Abel, of him who has failed in everything and kills his neighbour because he is successful, it is the anger of losers. If the French did not have this fault, one could forgive them for many things. 

Ferry goes on to say that “As soon as an individual profits, be it by ever so little or however legal, from his position, homo democraticus is ready to rise up against him.” And he says that if a man should rise above others, this same homo democraticus immediately invents, to explain his success, reasons to pull him down: “if he has succeeded or is more famous, it is because he took advantage of connections or immoral methods, or belongs to a powerful lobby, etc.”

No one who has long dwelt among human beings will fail to recognise this, yet it does not quite seem to apply in this case. On the contrary, it sounds more like the defence of a caste to which the author himself belongs than a paean to meritorious endeavour. 

Even if we cannot say that living well is a sign of demerit in itself, neither can we say that it is a sign of merit. There are, after all, such things as ill-gotten gains. At a time when millions of people find themselves in a tight financial corner despite having worked all their lives, I do not find it surprising or appalling that they object to seeing a man who has lived all his life from the public purse, and who raises no objection to public acts of envy, basking in luxury, even if only temporarily (how temporarily remains to be seen). 

There is nothing more unjust than economic equality, but this does not mean that we cannot ask about the legitimacy or source of wealth. In matters of hypocrisy and inequality, distinctions remain important.

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A pure bureaucracy, which is what the British criminal justice system has become in all but name, will do almost anything rather than solve the problem with which it is presented. It will invent any number of complex procedures ostensibly meant to solve a problem, but really just designed to keep itself busy. A problem solved, after all, poses a potential threat to a bureaucracy, insofar as it might be used to justify a reduction in its size whenever the next round of budgetary cuts is proposed.   

A fine British example of a bureaucracy’s tendency to invent extra procedures rather than find a genuine solution to a problem is the so-called Gang Injunction, a civil disposal of youths who commit crimes of violence while belonging to a gang. Various conditions are imposed on them (such as not entering certain areas or associating with certain people), the violation of which may, in theory, lead to their imprisonment.

A young man named Callander O’Brien was recently made subject to one of these orders, whose conditions included that he did not possess a balaclava-type helmet, did not ride a bicycle in public, did not carry a knife, did not run away from a policeman when told to stop, did not enter the London Borough of Islington, and did not contact or associate with anyone on a list of 59 persons. He was allowed to use only a registered mobile telephone and was to show his social media posts, none of which could incite violence, to the police.

Although only 19 years old, Callander O’Brien already had an extensive criminal record going back four years. He had also been made subject to one of these Gang Injunctions before, whose prohibitions—many similar to those in the subsequent one—he had flouted. For having done so, he was sentenced to an eight-week period of imprisonment in a youth prison, a punishment that was suspended for six months.

The elaborate absurdity of this hardly needs emphasis. If it were not for the injunction, would he be permitted to carry a knife, run away from the police, and incite violence on social media? Will it henceforth be a defence against a charge of inciting violence that the accused did not have an injunction against doing so and therefore thought it was permissible?

The difficulties of enforcing such an injunction are obvious. It is hardly to be expected that a policeman could recognise Callander O’Brien on sight, even if his picture were widely distributed. It would follow that either O’Brien would be able to break the injunction against riding a bicycle in public with impunity, or the police would have to stop a hundred youths on bicycles who might be he, giving rise to complaints of unjustified harassment of many innocent young people by the police. This injustice in turn would raise resentment against the latter and help to justify or explain illegal conduct.

The worst of both worlds is the most likely result: there will be some harassment of youth without any deterrence of O’Brien.

It is unlikely that O’Brien is highly- or well-educated, but it is equally unlikely that he could not figure out a way to obtain and use an unauthorised mobile telephone. In fact, we know that he can do so because he already has done so. As for any serious attempt to check that he had not communicated with one or more of the 59 persons named in the injunction, it would require surveillance of them all, a task simultaneously impossible and oppressively intrusive. Only the bureaucratic mind could concoct a laborious task with this unlikely combination of qualities. Taking it seriously would turn the police into a kind of tin-pot Stasi.

How are the police supposed to enforce the prohibition against owning a balaclava helmet? And is the kind of task that police should fulfil? By comparison with this, an injunction against wearing such a helmet in public would be almost sensible, but to ensure that O’Brien did not possess one (presumably for use at some time in the future once the injunction had lapsed) would require the unlimited right, along Gestapo lines, to enter and search his home. Even in these increasingly authoritarian times, it is unlikely that such powers would ever be exercised, and therefore Callander O’Brien knows perfectly well that, in more than one respect, the injunction against him is a dead letter—and he would know it even if he had not already experienced the lack of consequences for breaking a similar, previous injunction. In effect, though probably ill-educated, he is more intelligent than the entire British legislature, judiciary, and police force put together, and can outwit them easily. Nevertheless, a policewoman recently told the press, either through naivety or typical apparatchik bad faith, that “Gang injunctions are a powerful tool used in our efforts to crack down on gang crime and violence in our communities.”

What accounts for this ridiculous charade that is both ineffectual and totalitarian in its implications? Part of the problem is in the bureaucracy’s need to appear to be doing something without actually doing anything. But there is something deeper: namely a concerted drive, going back decades, to find alternatives to prison at all costs—including the cost of high levels of violent crime, up by nearly a hundred times since 1950.

It is true, of course, that no one wants a society that is peaceful and secure only because of the fear of real punishment, and the fact is that most people refrain from committing crimes for other reasons. We do not rob, steal or assault even when we could get away with it. But what is true of most people is not true of everyone, and people vary in their susceptibility to impulse and temptation. It is the susceptible who have to be deterred and, if necessary, incapacitated. The way the criminal justice system has responded to Callander O’Brien neither prevents him from committing further crimes nor deters anyone like him from following suit.

The police, of course, will be able to claim it as a success, but with successes like this, abject failure itself is glorious triumph. The so-called Gang Injunction is a perfect bureaucratic instrument: it makes work and avoids it at the same time. And it helps to make our society a little more totalitarian.    

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That power corrupts is an adage known by all—though how far it is the corrupt in the first place who seek power is an open question. Does the opportunity make the crook, or does the crook make the opportunity? Until a double-blind trial in real life conditions be performed, there is probably no definitive answer to this question; and such a trial will never be performed until the powerful are chosen at random.

The possession and exercise of power not only corrupts: more fundamentally, it addles the judgment. Sooner or later, the powerful, perhaps believing themselves immune from the normal constraints of human existence, take decisions that almost everyone of merely average capacity can see are mistaken or worse than mistaken. The powerful cease to be able even to act in their own self-interest.

In Britain, a Member of Parliament called Owen Paterson was found to have lobbied on behalf of companies from which he received $130,000, in defiance of the rules against such conduct. (One of the companies was subsequently granted contracts, worth hundreds of millions, without even going through a tendering process.) Mr. Paterson was suspended from Parliament, but the Prime Minister, Boris Johnson, intervened to try to prevent this sanction against his supporter and former colleague.

Personal loyalty is an admirable quality, but in a case such as this should have been confined to the private sphere of life. Probity should trump loyalty. Instead, Mr. Johnson sought to save Mr. Paterson’s political career by attempting to change retrospectively the rules which this Member of Parliament had breached, with spurious claims that they were unfair. Mr. Johnson succeeded in getting a motion through parliament to this effect, though about a third of his own Members of Parliament either abstained in the vote or voted against the motion. The outcry in the press and elsewhere was so great that he was forced to back-pedal, and Mr. Paterson duly resigned, thus avoiding the ignominy of suspension. This left Mr. Johnson looking not only corrupt, but weak and foolish or even stupid. He had recently been giving the world lessons in ethical environmental politics at the conference in Glasgow, and now he was revealed as a fierce defender of a crude form of corruption.

A week is a long time in politics, Harold Wilson said, and just as long in the public memory. Far greater events than this are soon forgotten; whole wars or catastrophes fade into oblivion within weeks or months and it has long been the case that the media obsess over events for a time and then speak of them no more when something else catches their attention.

Nevertheless, some residue or sediment of an affair such as that of Owen Paterson will remain. Not all Mr. Johnson’s famous bonhomie will efface the impression that he is corrupt, or at least the firm friend of corruption. He will never be able to pose as an honest man for fear of the subject coming up again and being used against him. And his judgment, even in small matters, was already highly questionable. Having taken conspicuously luxurious holidays at rich friends’ expense (in return for what favours? the average citizen is bound to ask), he also claimed that he could not “manage” on his Prime Ministerial salary, which is beyond the wildest dreams of 99 per cent of the population. Even if it were true that, thanks to his philoprogenitive propensities and other expensive tastes, he could not manage, one might have thought that elementary self-interest or an instinct for self-preservation, or even common decency, would have prevented him from saying so. Perhaps he counted on the weakness of his opposition to preserve him from the consequences of saying the first thing that came into his head, but this is not wise in a system in which people are apt to think that any alternative must be preferable to the dissatisfactions that they already endure. It is but a short step from a reputation for devilry to a reputation for being a devil.

However, our politicians do not emerge by spontaneous generation, like Venus emerging from the sea. They both shape and are shaped by the society in which they live, with which they have a relationship that I cannot but describe as dialectical. You cannot expect them to have virtues that are otherwise absent, or at any rate uncommon, in their society; and in the case of probity, once it starts to decline even as an ideal, its decline accelerates.

It is probably impossible to measure the prevalence of probity in any society, but my impression is that, with the creeping, or galloping, bureaucratisation of everything, it has declined markedly in my country within my lifetime. Bureaucracy calls forth euphemism, evasion, and lying as a magnesium sulphate cataplasm draws forth pus from an abscess. The ever-increasing pretence of measurement, combined with the promotion of abstract political or social orthodoxies, leads to cynicism and the devaluation of personal probity.

I first thought about this problem when the government instituted compulsory annual appraisals of doctors, which were largely pro forma. As one might expect from any governmentally-mandated procedure, much of the appraisal had very little connection with any real practical quality or outcome. A doctor was interviewed by another doctor who asked certain questions laid down in advance. (The appraisal of doctors soon became a profession in itself, often higher paid, and always easier, than medical work itself.)

One of the questions asked was, “Do you have any concerns about your probity?” When I was first asked this, I could hardly believe my ears.      

“I will answer that question if you will answer two questions,” I said to my appraiser.

“What are they?” he asked.

“The first is, what kind of person would answer such a question?”

“And the second?”

“What kind of person would ask it?”

He laughed, and said, “Oh, yes, I know, but just answer it so that we get this over with.”

In other words, he was asking, and I was answering, a question merely to fulfil a demand laid down for us as a condition of our employment, though we both knew that the demand was itself absurd—except if it were intended to destroy our probity, the very subject of the question, in which case it had been brilliantly designed. It destroyed, or undermined, two professional people’s sense of probity at a stroke.

Meaningless procedures are therefore, paradoxically, not meaningless. They have metastasized through our lives, so that each of us should feel sullied by them. They destroy our locus standi to distinguish between honesty and its opposite, the licit and the illicit, for they leave no one clean or innocent of grubby compromise. If we lack probity, how can we expect our rulers to have it?

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In eras of unrest, the scope of politics changes, as subjects once considered outside power’s scope get drawn into contests over who holds it. A subtle but significant example of this shift surfaced two months ago in The New York Times, in an opinion article that politicized history without acknowledging that the historical lens it used was far from definitive. The article, titled “America is an Empire in Decline. That Doesn’t Mean it Has to Fall” by political economist John Rapley, used an interpretation of the Roman Empire’s dissolution to endorse policies favored by the Washington establishment.

As Rapley describes it, Rome’s history with the barbarians who eventually conquered it matches America’s 75-year relationship with countries like China, which have used “growing markets and abundant supplies of labor” to begin to exert political force. But, Rapley argues, unlike Rome, America has an “out” provided by the free market. “Western countries … still retain an edge in knowledge-intensive industries” and “will require workers,” which means that “migration … [is] what stands between the West and absolute economic decline,” as long as we avoid “an unnecessary, [wealth-draining] conflict” with China. In Rapley’s concluding recommendations, Americans should “give up trying to restore [our] past glory through a go-it-alone, America First approach” and work with China on “pressing dangers … such as disease and climate change” while maintaining our global position through our currency, our capital, our military, “the soft power wielded by [our] universities,” “the vast appeal of [our] culture,” and alliances with “a coalition of the like-minded.”

Rapley’s piece supports the social, economic, and foreign policy favored by the Democrats and centrist Republicans who have largely, though not exclusively, guided Washington policymaking for the past 75 years. But its use of Roman history makes it a sharper version of a more recent political trend on the rise since at least the early 2000s: political prognosticators reading America through an interpretation of Rome favored by prominent scholars like Peter Heather, who argue that Rome’s fall came at the hands of foreign barbarians forming powerful new confederations, entering the empire’s domain, and then combining into larger groups the empire could not defeat. In the view of these analysts, Rome’s lessons for America involve harnessing our national government to prevent this fate of outside takeover from present-day threats ranging from Islamists to the Chinese—whether by addressing a “chronic manpower deficit” in our army, attending to national physical health, encouraging migration to boost the workforce, or projecting “soft power” abroad.

But recently, a more subversive academic interpretation of Rome’s fall has developed which justifies a very different politics in America: that of constitutionalists, de-centralizers, and believers in reducing the power of the national state. According to academics who adopt an alternative interpretation, the Roman Empire’s decline came not from the outside but from within. In fact, the story of barbarian takeover was a fiction invented by the very people who really destroyed Rome: imperial bureaucrats who concentrated power under the false justification of protecting the empire from “barbarians,” which in practice was a political label deployed against dissenters. This is a historical story that both rewrites major aspects of Roman history and has serious implications for America today.

Rome’s Fall Came from Bureaucracy’s Rise

The most prominent contemporary thinker who has articulated this thesis may be the historian Michael Kulikowski, the author of The Tragedy of Empire who holds that, in the words of the proverb, “the fish rots from the head downward.” Kulikowski’s general thesis isn’t new: older historians have traced decisive changes in Rome to the shift to imperial government under Augustus, as Roman assemblies which had shared power with a senatorial elite were reduced to breads-and-circuses and the Senate to an organ of the emperor’s control. But Kulikowski extends his examination by several centuries to focus on Roman government after 200 CE and the way it led to the Western Roman Empire’s fast dissolution after 395 CE In the process, he uncovers surprising facts about the effects of the imperial state created by Augustus’s successors. According to him, the roots of the empire’s decline truly began with a new class of elites: “equestrians” or “administrators,” experts or specialists brought in by emperors, who exercised a silent revolution against the old senatorial class. These bureaucrats were committed to standardizing and centralizing government which in the past had operated off regional customs and concerns, and their commitment to “impersonal” administration was matched by new opportunities to ply their trade.

The biggest of these opportunities came from Emperor Caracalla’s “megalomaniac gesture” in 212 CE of granting full Roman citizenship to almost everyone in the empire. This shift meant that the new equestrians had to work out how diverse populations—now considered citizens—would relate to each other under Roman law. And this, in turn, meant aspiring to a level of governing “uniformity”—government as standardized “managerial” practice instead of a product of regional customs—that had never been “possible” or “necessary.” How would the multiplying equestrians and their emperors explain this new intrusiveness, this conviction that “uniformity can be achieved and therefore should be achieved,” over populations that had been left alone? With rhetoric, as language that until recently scholars had considered “imprecise bluster” began to suffuse Roman laws.

This new language involved a “binary that brook[ed] no compromise” between two categories: those on the right side of whatever uniform project the government embarked on, true civilized Romans, and those who resisted it, uncivilized barbarians. Crucially, the term “barbarian” did not refer to an actual, stable category of people. Instead, it was a mutable definition that could apply to groups regardless of geography (whether they lived inside or outside the empire) or ethnicity. At its root, it was deliberately “polarizing rhetoric” in which opponents of government policy and law were, by definition, barbaric, uncivilized, and anti-Roman “in their very being”: “necessarily excluded from the Roman polity and the protection [it] offer[ed].”

The force of this rhetoric was precisely that it could apply to anyone, depending on the emperor’s desire. Originally, it helped justify persecuting Christians. Then, when Emperor Constantine reversed course, pagans became the outsider barbarians while Christians became civilized Romans. These moves multiplied as different factions backed by provincial elites contested for power over the empire: competitions with enormous stakes given Rome’s newly centralized reality. The weaker these competitors were, the more they used rhetoric to justify their moves and label their opponents. In the end, the bureaucrats became the servants of these power players and the rhetoric they themselves had helped create: if the “[equestrian] aspiration to uniformity of governance is where we find the ideological shift to … totalizing discourses” then the later persecutions became examples of “an equestrian managerial attitude working on behalf of [the] new totalizing … discourse,” e.g. bureaucracy serving totalitarian ends.

Eventually, a Germanic transplant named Alaric, resentful at being denied advancement by bureaucratic operators who for various reasons wouldn’t allow it to him, embraced the label of barbarian and the uncivilized destructiveness it implied, threatening to sack and then actually sacking Rome. In the process, he put to rest the fiction that the empire had become anything other than warring groups fighting for control of a state that they had weakened with their efforts. As Kulikowski puts it, “[the] people ripping down elements of the state structure in order to control it … [found] that [they] hollowed everything out, there [was] nothing left, and it [fell] apart.“ But later historians of Rome’s decline ignored these realities, using equestrian sources for evidence and accepting these sources’ barbarian-Roman dichotomy at face value. The result is that, up to today, historians continue to portray the fall of Rome as a product of “foreign” invaders from beyond its borders who crossed over, rather than what it really was: the result of “Romanized” actors like Alaric taking over a state which equestrian centralization and its effects had already largely destroyed.

America’s Centralization Began with Bureaucrats

Though Kulikowski draws only a few contemporary parallels to his view of Rome’s decline and wouldn’t necessarily share a constitutionalist’s approach to American history, his narrative of Rome maps with startling precision onto America’s since 1945. This was when our shift to empire empowered national bureaucrats to execute a silent revolution against state legislatures, chapter-based associations, and the national Congress which had helped shape politics up to that point. Like the Roman equestrians, the new American bureaucrats justified their move with rhetoric. But their move’s fundamental function was to destroy the balances of the Constitution between the federal and state governments: sucking power from the peripheries (the states) and toward the center (Washington, DC).

The first of these bureaucratic takeovers was judicial, as the Supreme Court asserted that ensuring “equal rights” demanded unprecedented national judicial control over state governments. This control wasn’t only for correcting egregious wrongs like Southern segregation but for handling issues of legislative apportionment, the relationships between churches and states, and states’ employment policies. Even supporters of these rulings acknowledged that some of them had no basis in the Constitution. And, though some were hailed as “pragmatic compromises,” their real significance was that national appointees were making choices they had never needed to make before.

National executives exacerbated these shifts. America’s Caracalla, arguably, was Lyndon Johnson, whose civilizing quest in Vietnam and Great Society programs drove Washington expansion and made bureaucrats arbiters of race relations and state-run programs for Great Society progressive ideals. Johnson’s successor Richard Nixon, another tortured vessel of ambitions, increased regulatory authority at an even faster clip. Thanks to their efforts, Washington became a city of administrators, regulators, and corporate lobbyists who ensured that new bureaucratic regulations fell on small firms not large ones. All the while, Congress, the most representative branch of the national government, became a blank check for executive action, thanks in part to Supreme Court rulings which mixed assertiveness over the states with deference to the Executive.

Like in the Roman Empire, this revolution in affairs was a silent one, because America’s new equestrian class produced its own propagandists, this time from government-funded universities and corporate media. At their hands, rhetoric suffused reporting, and politics was discussed in terms of its moral promises or its problem-solving “pragmatism”—ignoring the fact that both the morality and the pragmatics flowed from a newly-centralizing national government. Indeed, whether the project was crusading Wars on Poverty and Crime, or split-the-difference Supreme Court rulings on issues like affirmative action and abortion, America’s moral and practical agendas now came from Washington, DC. Only in subversive academic circles were these moves discussed in terms of the actual power shift that was occurring. Only in these circles was an important question asked: had a centralized government grown so powerful that it made legal rights into “parchment guarantees” that could be easily taken away?

New Civilizers and New Barbarians

In the meantime, the new equestrian classes of propagandists and bureaucrats mixed, bringing distinct ideological projects that they imposed through the centralizing state. If the first movers of this mix were Kennedy-Johnson Democrats, their most successful immediate successors were the academics, magazine writers, and think tank denizens who formed the neoconservative movement which pushed a war on crime and then a war on terror often using the language of civilization and barbarism to justify putting different groups outside the protection of America’s laws. In an offhand reference, Kulikowski cites the neoconservative rhetoric about terrorism as a military struggle, but he could also hone in on the rhetoric about the Black underclass that prominent neoconservative academics used to justify national enforcement against “superpredators”: purported inner-city barbarians who “are so impulsive, so remorseless, that [they] can kill, rape, maim, without giving it a second thought.”

The next academic-media movers were progressives, who also came from the newly-powerful academic-bureaucratic sectors but whose definitions of heroes and villains differed. At their hands, and with neoconservative support, the identity of “the other” has changed—no longer Black youth or Muslims but “deplorables,” “racists,” and “Christian nationalists.” Still, the totalizing discourse remains the same, one that justifies an ever-escalating series of power grabs. Tellingly, as far back as fifteen years ago, the Bush Administration was taking this approach: it brought “civilization” to Iraq even as it argued for amnesty for undocumented immigrants in totalizing terms—dismissing opponents as bigots and ethnonationalists—and strengthened purportedly “free” trade with China that, when it came to America’s strategic position vis-a-vis China, wasn’t necessarily free. Today, the Biden Administration has doubled down on these moves: allowing unchecked unauthorized migration in the name of “inclusive” ideals and economic growth even as it emphasizes strategic cooperation with China and mounts a war to defend “civilization” against Russia.

Circling back to ancient Rome strengthens the parallels between empires. Like mid-twentieth-century America, Rome changed when a new class of institutionalists began supplanting legislatures with bureaucracies and justifying the shift with idealized rhetoric. Like today’s bureaucratic parlance about “deplorables” and “insurrectionists,” the Roman rhetoric of “barbarians” justified using state power against anyone opposed to new administrative agendas. Like today’s operators, the Romans promoting these agendas used their “new totalizing conformist discourse” to enforce “managerial and ideological uniformity” over parts of life from taxation to religion. Like our own zero-sum politics, competition for power in Rome increased as centralization did, with the result that institutions were hollowed out by factions trying to control them.

These parallels to Rome clarify a likely end of the road for America if we fail to return to our constitutional structure. They also point to the dangers of listening to a media apparatus more interested in using the past for propaganda than in considering histories that might undermine its authority.

The post Trading Constitutionalism for Bureaucracy appeared first on Law & Liberty.

Since the Nixon administration, the federal government has been required to justify the use of public resources using benefit-cost analysis. This method, known as BCA, says that a regulation or a spending item should be approved only if the expected benefits exceed the expected costs.

On its own, BCA is not enough to justify a policy. However, it is a useful tool for showing the benefits and costs of government action and to stress-test conclusions by varying assumptions.

Earlier this year, the Biden administration finalized new rules that will allow bureaucrats to juice the results of BCA in favor of privileged identity groups. This risks undermining the integrity of BCA as a tool for rational policy debate and politicizing one of the last non-political areas of government decision-making. Those revisions were all confirmed in the final rules issued on November 9.

The proposed revisions to BCA guidelines for government programs and regulations have many flaws. These include the use of “global” (as opposed to purely domestic) cost and benefit calculations, the inclusion of highly uncertain assumptions about future generations, and the fanning of class warfare against the rich. But few have noticed the proposed green light for the use of identity categories in BCA for “advancing equity.”

Both of the proposed revisions want analysts to consider “the relevant groups of people who gain and lose from policy decisions.” By itself, this is standard practice in BCA when the gainers are poor people whose “marginal utility” from one more dollar will be greater than that of rich people. Otherwise, rebuilding McMansions after a hurricane will always seem a better policy than rebuilding trailer homes.

But the Biden administration wants to add “race” and “ethnicity” as well as other identity categories to the mix on the assumption that some groups are like rich people: they have too much privilege so any additional benefits to them should be discounted. Other groups are like poor people: they don’t have enough privilege, so benefits to them should be given more weight. The result would be to skew BCA in favor of whatever group the administration is currying favor with at the moment, totally apart from whether the individuals affected by a policy are actually underprivileged in an economic sense.

A policy that would bring $50 of benefits to a middle-class Asian community, for instance, could be given priority over a policy that brought $100 of benefits to a poor white community of the same size on the theory that the white community should be penalized for its alleged racial privilege.

This is what the regulatory circular means when it refers ominously to “the distribution of conditions in the baseline.” Like a communist land reform program, the revisions seek to label people based on ascriptive identities and then distribute government largesse based on an ideology. In the anodyne language of the regulatory revision, this approach “may lead an agency to select a regulatory alternative with lower monetized net benefits over another with higher monetized net benefits.”

Since neither revision limits the “demographic groups” or “underserved communities” that analysts can consider, a proliferation of identity categories could be inserted into any BCA. “The proposed revisions would include a list of possible groups to examine,” the regulatory revision explanation notes, but the given list is not “exhaustive of groups that may be affected by rules.”

For instance, the regulatory revision also mentions “gender” as well as “sexual orientation.” Having trouble getting the numbers to sing for a new transportation project? Maybe the target area is a city with a high number of gay people. Presto: just assume that the marginal utility of sexual orientation privilege is higher for gays than for straights (by assuming a “baseline” of rampant homophobia) and you have an “evidence-based” argument.

Another proposed category is “family composition.” Want to derail school upgrades in suburban neighborhoods to steer money to inner-city schools? A solution is now at hand: penalize the stable two-parent families of suburbia for their unearned privilege.

Indeed, the analyst will no longer have to bother justifying such choices. Alongside the proposed revisions, the White House issued new guidance for “participatory” benefit-cost analysis, giving grievance groups an extra loud voice in the proceedings. Regulators are now encouraged to undervalue input from whites—who apparently participate in civic life too much—in order “to facilitate meeting requests” from “underserved communities,” “communities that might not have historically participated,” or those that “may have been systematically denied the opportunity to participate.” Need more clarification? In apparent order of importance, the guidance gives the top three groups as non-whites, non-Christians, and “LGBTQI+ persons,” as well as an uber-privileged caste of “individuals who belong to multiple such communities.”

The revisions prudently avoid laying out the odious implications of the changes. But left-wing lobby groups have been happy to fill the silences.

A coalition led by the National Women’s Law Center commented that “income is not the only characteristic that agencies should consider in a distributional analysis.” The Environmental Defense Fund likewise applauds the “the disaggregation of benefits and costs among racial groups” as “a positive first step” on the road to utopia.

Another cheerleader, the National Partnership for Women & Families, urges the use of extra-heavy bonus weightings for “multiple marginalized identities across lines of gender, race, disability, class, sexual orientation and gender identity.” Likewise, the Urban Institute wants the baseline of grievances to extend to the beginning of American history so that “cumulative burden over time” determines weights. It also wants to extend the privilege to illegal immigrants.

All of these advocates assume that the baseline for grievance groups is mass oppression which will always justify heavier weights for them. A coalition calling itself The Leadership Conference on Civil and Human Rights is confident that the baseline “will help to account for systemic racism.” Since its members include a group called American Atheists, one imagines a federal analyst discounting the interests of people of faith.

The most revealing comment on the proposals comes from Duke law professor Matthew Adler who urges an explicit embrace of “age, health status, race, gender, etc., or some combination of these” in making weighting decisions. By giving different groups heavier weightings based on the “marginal utility of non-income goods,” he promises, federal policymaking would become “more nuanced.” A policy forcing airlines to give the obese two seats, for instance, could be justified as recompense for the unearned privileges of those who diet and exercise.

Similarly, the socialist-leaning Washington Center for Equitable Growth wants “top-down direction and definition” for analysts trying to assign extra weights for grievance groups. The federal government might need to issue updated tables every month on the latest estimates of oppression for each group and the resulting weights to use in analysis.

These ideas reflect a broad push to reconfigure government actions along identity lines irrespective of socio-economic status. The law is sufficiently muddled on the question of when such discrimination is allowed that the Biden administration has simply opted to go ahead and hope no one notices.

Two Berkeley professors (whose work the White House miscited in support of its proposals) argue that such “equity weights” are a bad idea because they impose moral values on the analysis. “We are concerned by the idea that policy analysis, by itself, should mechanically promote any particular kind of policy,” they warned. The administration should pay attention before turning analysis into partisan calculation.

The post Grievance-Based Policy Analysis appeared first on Law & Liberty.

Politics doesn’t just make strange bedfellows; it can also make self-dealing ones. A new study of the economic impact of the $787 billion 2009 American Recovery and Reinvestment Act (ARRA) is trying to tell us about the need to close the gap between intentions and outcomes by moving decision-making and accountability closer to the communities the federal government is trying to assist.

In their recent paper, Joonkyu Choi, Veronika Penciakova, and Felipe Saffie found that politics significantly hindered ARRA’s effectiveness. Their study reveals that firms that contributed to winning political candidates were more likely to receive ARRA grants and these firms subsequently created fewer jobs. Specifically, a 10 percentage point increase in the law’s politically connected spending resulted in a 33 percent drop in the job creation at the state level. In other words, instead of being driven solely by economic need and oriented toward employment outcomes, the distribution of stimulus funds was often skewed by firms’ political ties, leading to less efficient outcomes.

The findings underscore the high cost of political influence in government spending and grant-making. That political influence can so significantly distort the efficient allocation of resources serves as a critical reminder of the importance of transparency, accountability, and evidence-based policy. Such a reminder is all the more relevant in the face of massive new federal spending designed to restore key industries and boost employment and economic growth.

Over the past few years, on a bipartisan basis, the federal government has begun funneling hundreds of billions of dollars into new, highly targeted initiatives intended to boost energy efficiency, reshore manufacturing, and increase employment in areas of the country with below-average labor force participation. Through these employment initiatives, the current administration has emphasized the need for “quality” jobs (those with good wages and benefits) and is seeking to help disadvantaged workers gain skills, overcome barriers, and get to work.

Many of these programs are just now reaching their operational phases. The scale of the investments makes them a proving-ground for whether place-based economic and workforce development programs, if properly aligned and energetically implemented, can restore vibrancy in communities hit by the effects of automation and trade.

The jury will be out on whether these programs are successful for at least several years. There are, however, already some signs for concern. Recent reporting on two key Biden initiatives—broadband deployment and electric car charging stations—points out how plans and good intentions struggle to translate into positive outcomes.

In the case of broadband, despite a massive $43 billion appropriation to expand access to high-speed internet, not a single business or home has yet been connected via the program. As multiple people on X pointed out, that’s enough money to buy everyone who lacks an internet connection a Starlink subscription, thus bypassing the time-consuming process of laying cable. It’s a similar story with electric car chargers. The federally-led effort to establish a national network of charging stations is proceeding at a painfully slow pace with just seven new stations installed out of the 500,000 planned by 2030. As challenging as these initiatives are to implement, they are child’s play compared to the complexities involved in helping low-skilled, disadvantaged individuals succeed in training and employment programs. 

As the ARRA study suggests, this tendency to over-promise and under-deliver is aggravated by political capture. Place-based economic development is tough because the processes involved in securing federal grants favor larger organizations that have applied before and have good grant writers and managers. Larger groups also have critical social connections that are essential to the organizational partnerships required for competitive applications.

Meanwhile, small organizations, which often have a better understanding of the neighborhoods, families, and individuals being served, struggle to compete for federal dollars and are not in the mental (or actual) rolodexes of the large organization leaders. As a result, the social capital and fine-grained knowledge needed to address the needs of disadvantaged workers get left out of the equation. Under these conditions—challenging program objectives combined with a lack of “high-touch” partners at the local level—poor performance seems almost predestined or, at the very least, unsurprising.

When it comes to job training and social policy interventions, small and personalized is sometimes beautiful. For instance, one of the most effective job training models on offer is “sector-based” employment programs: small and mid-sized, locally-driven initiatives that help under-skilled workers gain training in higher-salary sectors like information technology or healthcare. Sector-based programs train for both noncognitive (“soft”) skills and technical skills. The returns to such training in placements and wages are impressive. While replicating and scaling them effectively remains difficult, we at least have evidence that when done properly, they work.

In other areas, evidence suggests that emphasizing personal agency may be the fast-track to improving life outcomes for disadvantaged individuals and families. One evaluation found that homeless families who received a voucher for housing did better on almost every measure than those who received vouchers and services. Individual training accounts that provide money for training without intensive support services have also been successful in improving employment and wages. Another study on the Bush administration’s Moving to Opportunity Program, which provided resources to low-income families that wanted to relocate to more stable neighborhoods, showed strong long-term impacts on children. The common element to each of these programs is that they focus on leveraging the personal knowledge and agency of individuals rather than shifting responsibility for planning to a case worker.

While none of these findings are definitive, they do strongly suggest we expand the use of such models—small, local, and focused on personal agency—alongside traditional top-down, centralized approaches to improving social and economic outcomes and then evaluate the relative outcomes. Let the more successful model win.

What would such an approach look like when it comes to place-based economic development funded through mechanisms like ARRA and the more recent Biden administration programs? At the state and local level, it might look a lot like the “revenue sharing” programs of the Nixon administration. These were essentially federal grants to units of local government that came with few if any strings attached. Revenue sharing created pools of resources that could be used at the discretion of local governments to fund projects that boosted local well-being. Such grants could be spent on infrastructure, parks, and economic development initiatives the local jurisdiction believed would provide the greatest benefit to their communities. Planning and implementation—and, crucially, accountability—would also be in the hands of local government. This wouldn’t fundamentally alter the conditions that cause political capture, but at least local voters would be able to ask questions and demand answers when it arose. Of course, there’s one thing revenue sharing arrangements cannot do that categorical grants can: provide photo-ops and credit-taking opportunities for the elected officials who vote on individual pieces of legislation—even when they actually voted against them. Unfortunately, federal spending on economic development is an act of political capture all the way down. It is time to get out of the trap.

The post The High Cost of Political Capture appeared first on Law & Liberty.

The Department of Defense’s entrenched procurement model is characterized by high costs, low volumes, and sole-source contracts. Given the demands of modern warfare, it represents a critical vulnerability in the US defense apparatus, particularly against peer and near-peer adversaries. As we have recently outlined, the DOD needs a paradigm shift in procurement practices that utilizes free market principles—transparent pricing, open competition, enforceable contracts, and supply-demand dynamics—to foster a competitive and innovative defense industrial base.

The Challenge

The DOD has ended up in a self-defeating trap wherein it spends heavily on R&D in a way that works well for generating technical overmatch, differentiation, and exquisite capability, but fails utterly for the low-cost production of commodity parts at scale. A great deal of thought has gone into the problem of reforming the DOD purchasing system in order to acquire weapons and platforms at lower cost and to get them into the field faster. As one of the present authors recently observed, the price of advanced munitions is drastically increased by “a highly bureaucratic, antiquated manufacturing and contracting system.” As a result:

a Tomahawk missile costs $1.5-2M today, the United States only has about 4,000 of them, and the supply is likely to shrink to less than 1000 units as part of an ongoing modernization program. Similarly, a modern torpedo costs as much as several million dollars. Lightweight Mark 54 systems are cheaper but still in the million dollar per unit range, a Harpoon anti-ship missile costs $1.5M, and Patriot anti-aircraft missile unit costs are in the $4M range.

This system sufficed in a world where the main goal of the defense industrial base was the generation of technical differentiation and overmatch of non-peer adversaries, and where cost was not a decisive source of differentiated advantage. A defense acquisitions culture that gave a very small number of contractors the room to develop very high-performance systems, in small volumes, made sense in this context. And scaling the production of munitions on the assumption that the US would be fighting small wars against non-peer adversaries meant that even a modest capacity for production would be adequate for replenishing reserves between wars.

This is not the world in which we live today. We are fighting, once again—through proxies and allies for now—peer and near-peer adversaries. And we are failing to provide our proxies with the means to achieve swift and decisive victories. This is in no small part because we are hesitating to deplete our own stockpiles of key munitions. Our capacity to replenish these munitions is simply not up to the task of supporting long wars against Russia, China, Iran, and their various allies and proxies, particularly as these wars involve Large-Scale Combat Operations (LSCO).

Today, we behave like autocrats in our DOD purchasing, implementing many of the worst aspects of a top-down, centrally planned, limited-sourced, monopolistic acquisitions system. In fact, the autocrats are outperforming us. Russia’s economy, in GDP terms, is roughly comparable to that of Mexico. It is unreasonable that Russia should be able to go toe to toe with NATO in terms of output of drones and munitions. But Russia, with help from their Chinese and Iranian allies, is outstripping the West in the production of munitions and consumables. 

We should be leveraging the power of capitalism and free markets to drive down costs and increase capacity. That means more than just signing new contracts with the same old DOD primes. It means a fundamentally different attitude toward building military systems and consumables. 

Changing the Business Model

There’s a different business model for building these parts that the DOD should explore, where the DOD seeks to act as a good customer. By being a good customer, the DOD will be able to leverage innovation, capital, expertise, and competence from industry in order to dramatically improve availability of both commodity and advanced munitions to the warfighter.

But, one might ask, why bother? Does cost matter? History suggests that it does. When fighting near-peer or peer adversaries in conventional conflicts, all things being equal, the side that can arm more men with more and better weapons, and faster, is more likely to win. That means that the side that’s able to generate to-scale quantities of quality armaments at a low price has a decisive advantage, especially in any war of attrition. If the goal is to spend the adversary into oblivion, and the two economies are roughly the same size, the side that generates munitions and military systems at a lower cost and higher quality has a decisive advantage.

We have a tool at our disposal for doing this that our adversaries do not: the free market. It’s time we started to use it. Four characteristics of the free market are particularly relevant: transparent pricing, enforceable contracts, open competition, and prices determined by supply and demand.

For existing, incumbent military systems and components, it should be relatively easy to generate all of these conditions. Note that while aspects of this reasoning also apply to cutting-edge programs aimed at generating technical differentiation and capability overmatch, what we are talking about below is primarily focused on ways to improve the cost and availability of commodities, legacy consumables, and components. In particular, we are focused on military systems that have already been introduced, and for which any upgrades have been exclusive to subsystems that can be easily swapped out, such as new software or new chips in a guidance module. Typically, these systems or munitions will have been expended in the field for many years, and their detailed capabilities and specifications will have been extensively reverse-engineered already by our main adversaries, so the need for sole-sourcing and very tight information security will be greatly mitigated.

Being a Better Customer

What does it mean for the DOD to be a good customer? It means understanding the constraints and pressures on its vendors and designing its contracts and interactions in such a way that its vendors are likely to be successful, even if doing so requires that the DOD change political and financial incentives within the organization. In the business world, when depending on highly specialized suppliers, the customer has to be very careful. It’s not enough for the customer to seek the most expedient supplier; in many cases, the customer must negotiate the viability of an ecosystem of vendors to make sure that multiple vendors remain viable and that a monopoly trap does not emerge. The DOD has repeatedly fallen into this trap. And of course, once the DOD is stuck behind a monopoly, prices rise almost without limit, and lobbying generates regulatory capture, making it all the more difficult to break these monopolies.

The DOD’s fickle behavior invites this monopoly trap. It tends to preserve the right to cancel contracts for any or no reason and with little or no warning. This feature drives down trust while driving up costs which only the most seasoned and well-staffed contractors can satisfy. The regulations within DOD contracts are so extensive and complex that compliance, even for businesses that are pursuing very conventional business models, becomes a significant source of risk. What is more, the requirements and specifications for the program or product often change over time. In a world where building a piece of hardware can take a couple of years from design to production ramp, changing significant requirements at any faster frequency creates devastating delays and essentially resets the program clock to the design phase. Equally detrimental to innovative startups and small businesses, the DOD takes a long time to pay invoices: The pay schedule is unpredictable, and the process of getting paid is so byzantine as to be a full-time job. Finally, when there is congressional budget chaos, DOD is forced to cancel programs and put other programs on hold. This kills innovative startups and small businesses that cannot obtain bridge financing and don’t have multiple months of cash on hand.

A customer that insists on behaving in these ways necessarily ends up, in any commercial relationship, being forced into paying for the full development cost of their programs. Asking commercial vendors to find financing from commercial sources given these criteria is nearly impossible.

There is, however, an entirely different model, which the DOD should consider for many of its programs. In this model, the DOD would focus on being a good customer, permitting it to entrain the commercial economic benefits of competition. This would entail embracing a number of changes.

First, the DOD should embrace time-definite programs. In corporate America, time is the most expensive commodity. The lack of certainty as to when a program will be awarded, how long it will take to get under contract, and what the size of the program will be are all very effective deterrents to commercial organizations engaging with the DOD. Even SBIR funding, which is supposed to be startup-oriented, can take years to be awarded and to get a check cut. It would be better for the DOD to make a habit, when opening bidding for new programs, to always indicate (a) how much funding has been allocated, (b) how long it will take to select awardees, and (c) how many awards they anticipate. Committing to making very fast decisions and then sticking to that commitment, would vastly improve the aggregate performance of DOD-sponsored programs.

Second, the DOD should act as a market-maker. For commodity components—say, generic 155mm shells and their components—the DOD could establish an international market among allies where pricing and forecasts are transparent to both vendors and customers. Transparent pricing would encourage new entrants to the market. Furthermore, allowing transparent, public bidding on price, at least within the community, would create a commercial-style dynamic that drives vendors to reduce pricing. The DOD could act as a market-maker by forecasting demand and auctioning off the deliverable contracts with appropriate lead time. Consumables like ammunition should be liquid markets, with all the features of any other commodities market—but with some basic guard rails to protect the national interest and promote appropriate levels of confidentiality.

Third, DOD could leverage prestige more effectively. An under-appreciated superpower of the DOD and NATO is the ability to confer prestige and credibility for free, or very inexpensively, on people who might want to work in the defense sector. Very small awards for graduate (and even undergraduate) students or young entrepreneurs, sponsorship of hackathons with prizes for the best results, and coding competitions can be organized with extremely low overhead. There are many talented young people willing to work for low costs who just need a bit of direction.

Fourth, DOD must also start matching programs for investment. If the DOD wants more venture and commercial investment in projects intended to serve the DOD, one of the best ways to do that would be to create a mechanism where any VC-backed startup can get their funding matched pro rata. Such a matching program would create a frenzy of venture investment in DOD-relevant activities, assuming that the go/no-go decisions could be made on commercial timelines, i.e., within only a couple of weeks. The decisions about who is qualified would need to be made in advance of the company raising their VC funding, so that they could use it as leverage with investors.

Fifth, along similar lines, DOD can create radically simplified contractual vehicles. Developing very simple contracts that do not include FAR flow-downs or special auditing requirements, and that do not require transfer of IP rights, would greatly aid small and medium businesses in interacting with DOD.

One of the most powerful mechanisms that the DOD can employ is a take-or-pay contract structure. In essence, this is a structure where DOD contracts to buy a fixed number of parts, at a fixed price, by a certain date—typically on a rolling basis, with an associated increase in volume and decrease in price. If the parts aren’t delivered or don’t meet specifications, then the DOD does not pay. If the parts are delivered, but DOD no longer needs them, DOD is still obligated to either buy them or pay a significant penalty. All of the implementation and financial risk in such an arrangement lives with the company—they have to raise the money to stand up production. For new entrants trying to build either commodity components or devices where a clear and simple specification and test regimen can be articulated, such a contract gives the supplier assurance that if they’re successful, they’ll get paid. Offering contracts like this to small and medium-sized enterprises (SME’s) eliminates the risk associated with product-market fit and will enable them to raise large amounts of money rapidly to finance R&D or capital investments to drive cost reductions. The key with such a program is that the requirements cannot change. If a new requirement emerges, it needs to be a new program, bid separately.

Sixth, one of the best strategies DOD can employ is to welcome failure. One nice feature of take-or-pay contracts is that if the program fails, there’s no direct cost to the taxpayer. Of course, if multiple programs fail, then the DOD can end up not getting the parts that they need. But allocating 10 or 20 percent of the spend on a major defense commodity to these kinds of programs, and splitting it among two to five new vendors, will often yield one or two successes. And if the cost reduction goals are set appropriately, those vendors are then able to force incumbent vendors to drive down their own costs. This kind of program will work especially well for commodities where there is little or no “invention” required.

Finally, DOD can establish a Cost Abatement and Reduction Projects Administration (C-ARPA). One thing that we’ve seen in recent wars is that being able to rapidly surge capacity for munitions, drones, and other expendable defense articles is critical to the defense of ourselves and our allies. Creating an ARPA organization solely responsible for driving cost reduction is more than warranted. This organization should have broad contracting authority, and its success should be measured in terms of driving down prices to the DOD for a wide variety of defense articles and systems. This could include anything from expendable drones to small arms to artillery shells to entire Arleigh Burke class destroyers.

All of this is not to say that DOD should exit the basic research business: Basic research is critical. But production cost reduction is a different game than basic research and the generation of highly differentiated, asymmetric technical capability. In the commodity end of the DOD purchasing universe, the key asymmetries that should be captured are dramatic cost reductions, increased competition, and capacity improvements.

Remaking the “Arsenal of Democracy”

Industry thrives on open markets, contractual certainty, and transparent pricing. If the DOD can move out of the mode of monopsony and monopoly, and give up its addiction to sole-sourcing, it will become possible to fully leverage the power of competition and the free market for defense acquisitions. This will be especially effective if DOD can make it easy to both buy from and sell to our allies, through the use of whitelists.

This is not a matter of forcing vendors of cutting-edge hardware to cross-license their most advanced designs to competitors, though such expedients can be perfectly justifiable in wartime. This is instead about identifying commodity parts, where the specs and requirements are well-understood and mature, and allowing market forces to drive prices down and volumes up. For more advanced consumables and systems, the key is to mature them with DOD R&D dollars to the point where a clear specification and set of requirements can be furnished to multiple vendors. This sort of program will be challenging for the most advanced systems, but for everything else, this should be eminently possible. If the ability to surge capacity is important—as it should be—contracts can specify the need to install and demonstrate spare capacity, by buying options on the delivery of larger volumes of parts in the future. 

Our current purchasing system is not fit for purpose to produce the equipment or the manufacturing infrastructure that we need to fight today’s wars, let alone the wars of tomorrow. It’s time for radical changes, and those radical changes need to leverage the free market, rather than diving into a statist, monopsonist, bureaucratic sink-hole of regulation and inefficiency.

(See here for a longer, more detailed version of this essay.)

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